As an emerging sector in the fields of energy conservation and environmental protection, LED lighting has witnessed significant growth in market size over recent years. This expansion is largely attributed to robust support from national industrial policies, rising public awareness of environmental protection, continuous improvements in LED product features, and a gradual reduction in production costs.
Owing to the vast potential of the LED lighting market in the future, the associated LED lighting driver power supply market also holds immense promise. Recently, an increasing number of companies have ventured into the LED lighting driver power supply sector. It's anticipated that competitive pressures both domestically and internationally will persist and even intensify.
According to statistics from the High-Tech Research Institute's LED Research Institute (GGII), the demand for LED lighting power supplies in China reached 18.8 billion yuan in 2016, marking a year-on-year increase of 15.1%. GGII predicts that with the rapid development of the foreign LED lighting market and the continued growth of domestic demand, the global LED driver power supply market will expand to 36.6 billion yuan in 2017. The demand for LED lighting power supplies in China is expected to maintain rapid growth, reaching 24.5 billion yuan, representing a year-on-year increase of 23.7%; by 2020, the domestic LED lighting power supply market demand is forecasted to reach 38 billion yuan.
Mainland China, particularly regions like the Pearl River Delta and the Yangtze River Delta, has emerged as a major hub for the global LED driver power industry, thanks to advancements in the electronics supply chain and relatively low labor costs, including research and development personnel expenses.
However, when Chinese LED driver power companies face off against international brands, what are their advantages? Furthermore, with the ever-clearer trend toward smart technology, where is the LED driver power industry headed?
Domestic Companies Compete with Overseas Leading Brands
LED high-power drive power is a critical sub-application within the broader LED drive power market. Due to its high technical barriers, brand barriers, and product certification hurdles, the market concentration is relatively high. Currently, major players in China's LED driver power supply industry include Infineon, Maoshuo Power, Shanghai Mingzhi, Yusheng Electronics, Jiansen Technology, Shilong Fuhua, and others.
Then, how does the performance of domestic high-power products compare with those of Taiwan's Ming Wei or foreign firms like Philips?
In the opinion of Zhang Huajian, General Manager of Infineon, “Over the last few years, with continuous advancements in domestic power supply technology, the gap between domestic high-power products and their foreign counterparts has narrowed significantly. For instance, Infineon’s outdoor high-power products are now fully capable of competing with leading international brands.â€
Zhao Nannan, Sales Director of Igor Lighting Industry Center, also believes that “in recent years, the differences between domestic and foreign high-power products have been diminishing, and many domestic brands are gaining a good reputation and market share overseas.â€
Based on Gaogong LED observations, while there is virtually no gap in existing domestic products compared to foreign high-power products, there remains a certain gap in terms of innovation capability and speed. This presents a challenge that domestic high-power companies need to address continuously.
In addition, what are the differences in demand for high-power power supplies between domestic and foreign markets?
"Looking at the domestic and international market landscape, the demand for high-power power supplies varies significantly. Taking the domestic market as an example, most project needs are price-driven, with relatively low demands placed on product brand and performance. Of course, there are also some project requirements, such as in public tenders, where, despite seeking lower prices, there are still certain expectations regarding brand and performance." Zhang Huajian analyzed the high-tech LED market.
In foreign markets, overall demand prioritizes brand and performance indicators, with price being a secondary consideration; in less developed countries, the demand tends to be more price-oriented, with lower expectations for product brand, performance, and even quality.
Zhao Nannan noted, “The main difference between domestic and overseas markets lies in the varying levels of product quality requirements. The overseas market generally demands higher quality, whereas the domestic market aligns with project needs, resulting in uneven quality requirements.â€
Intelligentization Will Be the Future Direction of High-Power Power Supplies
In recent years, buzzwords like intelligence, IoT, and artificial intelligence have gained traction, yet progress has been slow. It’s no surprise that people are eager for these technologies to take root and achieve breakthroughs. To some extent, this reflects the industry’s anxiety about the future of intelligent systems.
In this regard, Zou Chaoyang, Deputy General Manager of Yusheng Electronics, stated, “LED intelligent lighting is undoubtedly the future development direction, and the degree of intelligence in lighting heavily depends on the level of intelligence in LED driver power supplies. User needs always guide industry trends. The future development of LED high-power outdoor power supplies will focus on intelligence, connectivity, standardization, and modularity.â€
“The future direction of high-power outdoor power supplies is bound to be intelligent,†explained Zhang Huajian. From the perspective of lighting manufacturers, intelligent power supplies bring significant convenience to lamp design, debugging, and assembly, while also reducing maintenance costs. For end-users, intelligent power supplies offer more diverse functionality, catering to a wider range of application requirements.
In fact, although intelligent applications currently represent a small portion, the actual demand for intelligent power supplies is expected to grow. On a macro level, global energy efficiency demands are increasing. High-power lighting, being energy-intensive, stands to benefit significantly from intelligent solutions that reduce energy consumption.
As intelligent system technologies mature, power supply technologies are advancing as well. The two fields have achieved stable and close collaboration, providing a feasible foundation for realizing intelligent systems. In the future, to address cross-industry collaboration challenges, intelligent development will focus on unified technical standards and customized demand solutions.
“Actually, the fundamental functional requirement for lighting is that the power supply only needs to accept the voltage given by the external source. The intelligent control system lacks a unified standard now, and relevant departments should issue uniform standards as soon as possible—this is the current priority,†added Xin Mingfeng, General Manager of Jiansen Technology.
High-Power Power Prices Expected to Fall by 30% in the Next Two Years
With the promising prospects of the LED driver power industry, it has garnered increasing attention from society. Capital and talent are gradually converging into the sector, and the number and scale of enterprises are expanding. LED driver power products are entering the phase of market competition, with rivalry intensifying.
Due to the continuous expansion of the market, high-power products have stringent quality requirements in practical applications. Although more competitors are entering the market, ensuring high-quality product output necessitates significant resource investments. Therefore, Zhao Nannan anticipates that “prices won’t fall drastically in the short term, but with similar high quality, there will be mutual price suppression.â€
As we know, high-end LED power supplies are characterized by high power, harsh operating environments, and high prices, especially concerning the steep cost of premium power supplies.
For example, in the streetlight market, the overall competition is intensifying, with product prices dropping. However, the proportion of power supply costs in total lamp costs remains high, compressing profit margins.
Xin Mingfeng predicts that high-power power supply prices will drop by 30% in the next two years. As seen, prices of various brands have already decreased, with Jiansen Technology leading the way.
“Under the market-wide trend of price reductions, the cost of high-power outdoor power supplies will continue to decline in the coming years until it stabilizes at a new equilibrium point. Ultimately, competition will be defined by brand, quality, and service. A ‘Matthew Effect’ will emerge, with large enterprises consolidating their market positions and growing stronger, while smaller and medium-sized enterprises will see their scales and market shares further compressed, signaling a deep restructuring phase in the market,†said Zhang Huajian.
Based on insights from industry insiders, high-power outdoor power supply prices are expected to trend toward higher cost-effectiveness in the coming years. Major brands will leverage resources to produce higher-quality, more affordable products, enhancing their comprehensive competitiveness.
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